Warning: IPOs can be bad for your wealth

A banker working on the flotation of lastminute.com said amid the euphoria that the stock would never fall below its issue price. A decade later, the dangers of the IPO market are very much the same

By

William Wright

Updated: May 23, 2011 6:29 pm GMT

“The aim with this IPO is to price at such a level that it will never see that price again.” These words were not from one of the bankers running the initial public offering of LinkedIn, the online business network whose shares more than doubled on their first day of trading last week – but from a banker working on the flotation of lastminute.com in March 2000. More than a decade on from the dotcom crash, the dangers of the IPO market are very much the same.

The banker on the lastminute.com deal meant that the price would surge...